After seven years of political fireworks over the Affordable Care Act (ACA), a vote on the Senate’s bill to repeal and replace key elements of the law could be the prelude to a grand finale – or at least a crescendo – this week. On June 22, the Senate released the Better Care Reconciliation Act of 2017, which Senate Majority Leader Mitch McConnell (R-KY) acknowledges is a draft still in progress. Whether a version of this bill soars to the White House, or fizzles on the floor of the Senate will likely depend upon the GOP leadership and its ability to unify the various factions of the party this week. If the bill fails to attract the 51 votes it needs to move forward, Congress will likely abandon efforts to repeal and replace the Affordable Care Act (ACA) and move on to other issues such as tax reform.
Here’s how I see this process playing out over the next few days, and what I see as some of the important elements of the Senate bill to watch:
The Senate bill is still undergoing changes – The release of the bill may not have been an opening salvo, but it is still not likely a final bill at this point. We could see some significant changes to the draft over the next day or two. But everything could all come to an abrupt end on Wednesday when the Senate is expected to hold a “motion-to-proceed” vote to determine if it has the votes to move to consideration of the bill. If the motion fails, then the repeal-and-replace effort may be effectively dead. If the motion passes, it will likely be a clear indication that the Senate has the votes, and it will move to debate to the Senate floor. A final vote on the bill would likely be held on Thursday or Friday this week.
We are likely to see a very close vote – The drive to secure the necessary 51 votes for the Senate to move forward could be a nail-biter, particularly if Vice President Pence is called upon to cast the tie-breaking vote. If the bill passes the Senate, it will then move back to the House. I’m hearing that the House would not have time to take it up until after the July 4 holiday. If the House passes the Senate bill, as is, it would go to the President for his signature.
Here’s what we know about the Senate bill at this point:
- The Congressional Budget Office (CBO) score: The CBO released the score for the Senate legislation, estimating that – compared with current law – 22 million fewer people would have insurance coverage in 2026. This compares with the 23 million fewer people without coverage in the House bill. The Senate legislation would have a net decrease on the federal deficit of $321 billion over 10 years compared with $119 billion over 10 years in the House bill (see the June 6, 2017 Health Care Current).
- Medicaid expansion would be phased out over five years: The glide-path for phasing out the ACA’s Medicaid expansion is longer under the Senate bill than the House version. The Senate bill calls for continued funding for Medicaid expansion states over the next two years. Funding for the expansion would then phase out funding over the next three years.
- The tax credit would benefit the poor in non-expansion states: People with incomes ranging from zero to 350 percent of the federal poverty level (FPL) would qualify for federal premium assistance. Under the ACA, premium tax credits are available to people who earn between 100 percent and 400 percent of the FPL. Dropping the range down to zero could help to close the coverage gap for low-income people who live in states that opted not to expand Medicaid and that could bring more people into the insurance exchanges.
- Federal tax credits would be linked to a bronze-like benchmark plan: Under the ACA, premium subsides are pegged to the second-lowest cost silver-tier plan in each state, with a 70 percent actuarial value. The Senate bill calls for a benchmark plan that would be more similar to a bronze-tier plan, with an actuarial value of 58 percent. In the eyes of the Senate Republicans, they are tying subsidies to a less expensive plan, and allowing more low-income individuals to have access to subsidy dollars. While premiums for the Senate benchmark plan would be more affordable, out-of-pocket costs could be substantially higher.
- There would be a future for the state-run exchanges and HealthCare.gov: Some Senate Republicans had hoped to make the premium assistance tax credits available to individuals whether they buy coverage inside or outside of a public insurance exchange. But under the bill, the only way to receive a federal tax credit will be through an exchange, which could breathe new life into them. Moreover, the Senate bill calls for Congress to appropriate funding for the ACA’s federal cost-sharing subsidies (CSRs) for two more years to help individuals with out-of-pocket costs. It also funds a two-year reinsurance program for health plans to help shore up the individual markets.
Seven years after enacting a Democratic health reform law, we might wind up with a Republican health reform law.
Congress has passed numerous bipartisan health care bills in the past, and will likely continue to do so in the future. However, the ability to settle on a bipartisan approach to the coverage debate in the US is elusive and likely to remain in a perpetual state of flux – no matter the outcome of the Senate vote.
If the Senate Republicans are successful this week, Democratic lawmakers will likely fight such a law just as fiercely at their Republican colleagues battled against the ACA. If Democrats regain control of Congress in the future, another version of a bill will likely surface.
If the Senate bill does not pass this week and this major effort to repeal the ACA fizzles, we can expect new battle lines to be drawn over what to do next with the ACA. We may see certain health care provisions addressed again in the upcoming debate around tax reform.
Next week, Fourth of July fireworks will paint the night skies in communities across the country for a day or two. But in Washington, DC, our political pyrotechnics might be perpetually on the horizon.